DEFINITION of 'Telemarketing'

The act of marketing goods or services to potential customers over the telephone. Telemarketing may either by carried out by telemarketers, or increasingly, by automated telephone calls or "robocalls." The intrusive nature of telemarketing, as well as reports of scams and fraud perpetrated over the telephone, has spurred a growing backlash against this direct marketing practice.

Also known as telesales or inside sales.

BREAKING DOWN 'Telemarketing'

The United States and Canada have national "Do Not Call"(DNC) registries that give their residents a choice about whether to receive telemarketing calls at home. In the United States, the registry is managed by the Federal Trade Commission (FTC) and enforced by the FTC, Federal Communications Commission and state law enforcement officials.

Consumers who are registered in the DNC database can file a complaint if they receive a call from a telemarketer, which could lead to a stiff fine and sanctions for the telemarketing firm. However, calls from charities, political organizations and telephone surveyors are permitted and would be received by a consumer, despite listing his or her phone number on the DNC registry. Also permitted are calls from businesses with whom the consumer has an existing relationship, as well as those businesses where consent to call has been provided in writing.

In recent years, numerous North American firms have outsourced their telemarketing functions to lower cost jurisdictions such as India, Mexico and the Philippines.

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